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Die Hard Arcade is a beat 'em up for two players, who play as either John McClane or Chris Tompsen (Bruno Delinger and Cindy Holiday in the original Japanese version). Players fight their way through waves of enemies, using their fists, feet, and a variety of weapons that can be collected from enemies or the environment, from household items such as brooms and pepper shakers to high-damage missile launchers and anti-tank cannons. Most weapons are automatically lost at the end of each action scene, but hand guns can be retained so long as they have ammunition remaining. The typical level structure is a number of minions the player must defeat in many rooms, followed by a boss. Bosses can be anything from human minions of White Fang to spider robots. Quick Time Events are interspersed between many of the scenes. In these events, the player(s) may be running and turning a corner and they face an enemy, so they must perform a designated command to avoid being injured or to help defeat an enemy. In some cases failing a Quick Time Event will result in loss of health, as is usual for QTEs, but failing most will put the player characters into an additional action scene which they otherwise would not have to complete. Cut scenes are interspersed into the action.

The Saturn version also includes a port of Sega's 1979 arcade game Deep Scan, which can be used to gain extra credits. Unlike most arcade ports, no additional credits are provided; losing a single life results in a game over.

John McClane and Chris Tompsen (Bruno Delinger and Cindy Holiday) try to save the President's daughter, Caroline Powell from terrorists. There are a number of bosses on the game, including a biker called Hog, a Mexican wrestler named Jocko, the twin team of Mr. Oishi (a sumo wrestler) and Mr. Tubbs (an army general) and pairs of laser-shooting Spiderbots. The final boss, of which all the others are henchmen, is known as Wolf "White Fang" Hongo. . At the end of the game, if both players are still alive, the two players will fight each other on the rooftop of the skyscraper to gain the sole appreciation of the President's daughter. This is a homage to Double Dragon, which feature a similar "face-off" battle.

The game was created by Sega, using a team up of the successful Japanese AM1 (Arcade Machine 1, also known as WoW Entertainment) group and the US-based Sega Technical Institute (STI). AM1 provided the engineering and some of the design and art, and STI provided art, design and animation. Die Hard Arcade was the final game developed by STI before the studio was dissolved. The game was developed simultaneously for the ST-V Titan Arcade system and Sega Saturn, but the home version was released later.

The Japanese version of Die Hard Arcade, Dynamite Deka, was followed by a sequel titled Dynamite Deka 2 for the arcade and Dreamcast. The sequel was released internationally as Dynamite Cop. In 2007, a remake of the first game (without the Die Hard license) was released in arcades (on NAOMI) under the name Dynamite Deka EX in Japan and Asian Dynamite in Europe and the USA. Bruno, from the original Japanese version, later appeared as a solo unit in the 2012 crossover role-playing game, Project X Zone, recolored to match his Dynamite Cop appearance in the Western releases. Because of the character is based on John McClane, Bruno's likeness is modeled after Bruce Willis.